Growth Determinants of Women-Owned Firms in Eritrea

Abel Habtemariam Tedla


The paper discusses the growth of women-owned firms in Eritrea. Growth is defined by the increase in labour over time. The objective of the study is to identify the growth determinants of women-owned firms focusing mainly on selected covariates. It presents the theoretical review on the determinants of growth and provides country background. The paper is based on a study conducted on 370 women-owned small and medium enterprises (SMEs) in Eritrea. Two approaches were used. The first is χ2 where each explanatory variable is associated with growth. The second is the logit model on joint determinants of firm growth. The χ2 distribution identified three explanatory variables—marital status, experience and prior training of owners—as being associated with a firm’s growth. Based on the logit model, we generated probability distribution of firms’ growth. It was observed that a typical female entrepreneur has 0.65 probability of success. The study concludes that women entrepreneurs who get training and prior experience opportunities before starting business as being successful.


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